Barclays CEO Energy/Power Conference September 6, 2016
NEW GUIDANCE Revised Previous 9/6/2016 Total net production (MMcfe/d) 1,800 1,750 Net natural gas production (MMcf/d) 1,365 1,355 Net liquids production (Bbl/d) 73,000 66,000 Net Daily C3+ NGL Production (Bbl/d) 53,500 52,500 Net…
WHY OWN ANTERO Revised production growth guidance for 2016 to 20% or 1.8 Bcfe/d Momentum + 20% to 25% growth target for 2017 or 2.16 to 2.25 Bcfe/d Growth 6 rigs currently running, 70 DUCs at YE 2016 Production Sold 94% of…
APPALACHIA WILL SUPPLY NATURAL GAS DEMAND GROWTH As LNG exports, Mexico exports and power generation drive demand, gas supply growth through 2020 is expected to be primarily driven by the Marcellus and Utica shales, given their low full…
ANTERO WELL POSITIONED TO DRIVE SUPPLY GROWTH AR COMBINED TOTAL 12/31/15 RESERVES Assumes Ethane Rejection Net Proved Reserves 13.2 Tcfe Net 3P Reserves(1) 42.1 Tcfe Strip Pre-Tax 3P PV-10(2) 12.7 Bn SW Marcellus + Utica Rigs(4)…
GROWTH ENGINE THROUGH 2020 AND BEYOND Antero plans to develop over 1,000 horizontal locations in the Marcellus and Ohio Utica by the end of the decade while utilizing less than 25% of its current 3P drilling inventory PLANNED ANTERO…
LEADING REALIZATIONS DELIVER Anteros business strategy including firm transport to favorable markets, focus on liquids-rich drilling and hedging deliver market leading financial results Unit Cash Cost vs. 3-Year Average Realized…
HIGHEST EBITDAX & MARGINS AMONG PEERS Antero has extended its lead among Appalachia Basin peers in both EBITDAX and EBITDAX margin Quarterly Appalachian Peer Group EBITDAX (MM)(1) 500 Among Appalachian peers, AR has ranked in the top…
LARGEST FT PORTFOLIO IN APPALACHIA Anteros natural gas firm transportation (FT) portfolio builds to 4.85 Bcf/d by YE 2018 with 87% serving favorable markets, for an average demand fee of 0.46/MMBtu and positive weighted average basis…
ANTERO FT ELIMINATES NORTHEAST BASIS RISK Futures indicate an improvement in Northeast basis as new pipeline capacity is built, however, infrastructure expansions have historically been delayed and met by an increase in production,…
NGL GROWTH AND ETHANE OPTIONALITY Antero continues to rapidly grow its liquids production, with 2015 year-over-year growth of 117% and 2016 NGL production growth guidance of 71% Developing significant ethane optionality with an estimated…
POSITIONED TO BENEFIT FROM C2 RECOVERY Antero has significant exposure to upside in ethane price (C2) Ethane Prices (/Gallon)(1) Ethane Upside Impact to AR(3) 0.80 Ethane Futures (ICE) Incremental EBITDAX Attributable to Ethane…
AND C3+ VOLUME GROWTH AND PRICE RECOVERY Antero has 2.7 billion Bbls of net 3P NGL reserves Mariner East 2 is expected to be in-service by mid-year 2017 which should significantly reduce Anteros differential to MB pricing Propane…
HEDGING INTEGRAL TO ANTERO BUSINESS MODEL 2.1 billion mark-to-market unrealized gain based on 6/30/2016 prices 3.4 Tcfe hedged from July 1, 2016 through year-end 2022 at 3.71 per MMBtu COMMODITY HEDGE POSITION BBtu/d Hedged Volume…
BEST NATURAL GAS HEDGE POSITION FOR 2017 AR is 94% hedged through 2018 at 3.81/MMBtu, a 0.78 premium to the current strip Effective post-hedge Henry Hub gas price using 2017 Henry Hub of 3.20/MMBtu 4.00 120% 3.80 100% 3.60…
LEADERSHIP IN MARCELLUS HIGH-GRADED CORE Anteros internal reserve engineers have analyzed over 3,000 wells in southwest Marcellus, which led to the high- Southwest Marcellus High-Graded Core graded core outlines to the right…
EXCELLENT WELL RESULTS IN HIGH-GRADED CORE Antero and industry have completed 174 Pro Forma Acreage Position wells with advanced completions in the High-Graded Southern Rich Core Southern Rich Antero wellhead EURs range from 2.0 2.0…
ADVANCED COMPLETIONS DRIVING HIGHER EURS The initial performance of the 29 wells completed in 2016 using greater than 1,300 lb/ft has exceeded both our 1.7 Bcf/1,000 booking type curve and 2.0 Bcf/1,000 target through 140 days 2016…
LONGER LATERALS DRIVING VALUE CREATION High correlation of EURs to lateral length no degradation in results out to 12,000 laterals Antero has led the way with long lateral drilling programs 2Q 2016 completions had average F&D cost of…
CONTINUOUS OPERATING IMPROVEMENT Operating Highlights Utica Shale Ohio Marcellus Shale Top 20 best drilling footage days in Marcellus since 2009 have all occurred in 2016, including 7,274 drilled in 24 hours in West Virginia on the…
STEP CHANGE IN MARCELLUS DRILLING FOOTAGE New drilling techniques and technologies are shaving 10 days off lateral drilling times and up to 25% off drilling AFEs Key Drilling Highlights: Top 50 AR Marcellus Daily Footage Records…
PROVEN TRACK RECORD OF WELL COST REDUCTIONS Marcellus Well Cost Reductions for a 9,000 Lateral (MM)(1) 14 COMPLETION COST DRILLING COST 12.3 12 11.1 34% Reduction in 10.8 0.90 / 1,000 10.2 10.2 Marcellus well costs 10 since Q4…
MARCELLUS UPSIDE POTENTIAL 33% lower well cost per 1,000 lateral and 33% higher EUR per 1,000 since 2014 are driving rates of return significantly higher despite lower strip pricing 35/24 Pre-Tax PV-10 Pre-Tax ROR 45/84 Assumptions…
STRONG BALANCE SHEET AND FLEXIBILITY Antero Resources (NYSE:AR) Antero Midstream (NYSE:AM) Pro Forma 6/30/2016 Debt Liquid Non-E&P Assets 6/30/2016 Debt Liquid Assets Debt Type MM Asset Type MM Debt Type MM Asset Type MM Credit…
Antero Midstream (NYSE: AM) Asset Overview 24
MLP (NYSE: AM) HIGHLIGHTS SUBSTANTIAL VALUE IN MIDSTREAM BUSINESS Corporate Structure Overview Antero Resources Corporation (NYSE: AR) Public 11.9 Billion Enterprise Value(1) Ba2/BB Corporate Rating 39% LP Interest 61% LP…
AMS FULL VALUE CHAIN BUSINESS MODEL AM recently exercised its option on 15% interest in Stonewall, adding a regional gas gathering pipeline to its portfolio Well Pad Condensate Gathering End Stabilization Users (Miles) YE 2015 YE…
ANTERO MIDSTREAM GATHERING AND COMPRESSION ASSET OVERVIEW Gathering and Compression Assets Utica Gathering and compression assets in core of rapidly Shale growing Marcellus and Utica Shale plays Acreage dedication of 576,000 gross…
ANTERO MIDSTREAM WATER BUSINESS OVERVIEW AM acquired ARs integrated water business for 1.05 billion plus earn out payments of 125 million at year-end in each of 2019 and 2020 The acquired business includes Anteros Marcellus and Utica…
KEY CATALYSTS FOR ANTERO 1 Guiding to production growth of 20% in 2016 and targeting 20% to 25% in Production and 2017, with 94% of forecasted production hedged through 2018 at Cash Flow Growth 3.81/MMBtu, a 0.76 premium to strip 2…
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ANTERO CAPITALIZATION CONSOLIDATED Pro Forma(4) ( in millions) 6/30/2016 6/30/2016 Cash 28 28 AR Senior Secured Revolving Credit Facility 140 556 AM Bank Credit Facility 760 760 6.00% Senior Notes Due 2020 525 525 5.375% Senior…
ANTERO RESOURCES UPDATED 2016 GUIDANCE Key Operating & Financial Assumptions Updated Previous Key Variable 2016 Guidance(1) 2016 Guidance Net Daily Production (MMcfe/d) 1,800 1,750 Net Residue Natural Gas Production (MMcf/d) 1,365…
SUSTAINABLE BUSINESS MODEL At 6/30/2016 strip pricing, Antero has 2,713 locations with well economics that exceed 20% 6/30/2016 NYMEX Strip Pricing - Before Hedges rate of return (excluding hedges), pro forma for third-party…
2016 CAPITAL BUDGET Anteros 2016 initial capital budget is 1.4 billion, a 23% decrease from 2015 capital expenditures of 1.8 billion and a 58% decline from 2014 capital expenditures 1.8 Billion 2015(1) 1.4 Billion 2016 By Segment…
CONSIDERABLE RESERVE BASE WITH ETHANE OPTIONALITY 27 year proved reserve life based on 2015 production annualized Reserve base provides significant exposure to liquids-rich projects 3P reserves of over 2.4 BBbl of NGLs and condensate…
ETHANE RECOVERY ECONOMICS AND POTENTIAL VOLUMES RECOVERING ETHANE: ARBITRAGE VS. NATURAL GAS PRICING Example C2 Recovery Decision Assuming ATEX costs are sunk and Assuming 3.00/MMBtu Natural Gas NYMEX gas prices are 3.00/MMBtu, C2…
MARCELLUS SINGLE WELL ECONOMICS IN ETHANE REJECTION Assumptions Marcellus Well Economics and Total Gross Locations(1) Natural Gas 6/30/2016 strip Oil 6/30/2016 strip 80% 69% 1,500 1,235 Total 3P Locations NGLs 37.5% of Oil Price…
UTICA SINGLE WELL ECONOMICS IN ETHANE REJECTION Assumptions Utica Well Economics and Gross Locations(1) Natural Gas 6/30/2016 strip 100% 300 79% 84% Oil 6/30/2016 strip 71% 250 Total 3P Locations 80% 70% NGLs 37.5% of Oil Price…
FIRM TRANSPORTATION AND SALES PORTFOLIO While Antero has excess FT in place through 2017, the expected cost of unutilized FT is estimated to be modest at well under 10% of EBITDA Columbia Stonewall/Tennessee Momentum III EQT…
PORTFOLIO APPROPRIATELY DESIGNED TO ACCOMMODATE GROWTH (BBtu/d) 2016 Firm Transport Antero projects firm transportation in excess of 4,000 Total Firm Transport equity gas production of approximately 1,660 BBtu/d 3,525 BBtu/d in…
FT MARKETING EXPENSE UPDATE Illustrative Marketing Example: No Spread 2016 Projected Marketing Expenses: Unmarketable (EQT / M3) (/MMBtu) ( in millions, except per unit amounts) Demand 2016E 2016E 2016E 2016 TETCO M2 Pricing (Sold…
STRONG FINANCIAL LIQUIDITY AND DEBT TERM STRUCTURE Approximately 3.9 billion of combined AR and AM financial liquidity as of 6/30/2016 No leverage covenant in AR bank facility, only interest coverage and working capital covenants PRO…
POSITIVE RATINGS MOMENTUM Anteros corporate credit ratings were recently affirmed at Ba2/BB by Moodys and S&P, respectively, despite the severe commodity price down cycle Moodys / S&P Historical Corporate Credit Ratings Moodys Rating…
ANTERO RESOURCES DECEMBER 31, 2015 RESERVES Anteros proved reserves were 13.2 Tcfe, while its 3P reserves were 37.1 Tcfe Proved pre-tax PV-10 at strip prices was 5.7 billion, while the 3P pre-tax PV-10 was 11.2 billion Including…
ANTERO RESOURCES EBITDAX RECONCILIATION EBITDAX Reconciliation ( in millions) Quarter Ended LTM Ended 6/30/2016 6/30/2016 EBITDAX: Net income including noncontrolling interest (575.5) 155.5 Commodity derivative fair value (gains)…
ANTERO MIDSTREAM EBITDA RECONCILIATION EBITDA and DCF Reconciliation Six months ended in thousands June 30, 2015 2016 Reconciliation of Net Income to Adjusted EBITDA and Distributable Cash Flow: Net income 67,451 92,829 Interest…
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